(Adds ICAP declines to comment)
By Foo Yun Chee
BRUSSELS May 20 European Union antitrust
regulators charged Europe's biggest bank HSBC, U.S.
peer JPMorgan and France's Credit Agricole on
Tuesday with rigging financial benchmarks linked to the euro,
exposing them to potential fines.
The European Commission also said it would charge broker
ICAP soon for suspected manipulation of the yen Libor
U.S. and European regulators have so far handed down some $6
billion in fines to 10 banks and brokerages for rigging the
London interbank offered rate (Libor) and its euro cousin
Euribor while prosecutors have also charged 16 men with
"The Commission has concerns that the three banks may have
taken part in a collusive scheme which aimed at distorting the
normal course of pricing components for euro interest rate
derivatives," the EU competition authority said.
The three banks and ICAP, which refused to settle the case
in December, could face penalties of up to 10 percent of their
global turnover if found guilty of breaching EU antitrust rules.
JPMorgan said the EU charges were without merit and that it
would defend itself while Credit Agricole said it would examine
the charge sheet. HSBC said it would defend itself vigorously.
In December a record 1.7-billion-euro ($2.3 billion) fine
was levied on six banks including Deutsche Bank,
Royal Bank of Scotland and Citigroup for similar
offences. The lenders settled their charges and received a
10-percent cut in their fines.
Asked about the ongoing Libor probe against ICAP, European
Competition Commissioner Joaquin Almunia told a news conference:
"In the coming days or weeks, we will probably issue a new
statement of objections against the broker."
ICAP, the world's largest interdealer broker, declined to
comment. It was one of 10 institutions fined by U.S. and
European authorities last September for rigging yen Libor
Almunia also said regulators have yet to decide on the next
step of an ongoing investigation into suspected rigging and
collusion in the trillion-dollar foreign exchange market, the
world's biggest marketplace.
"We received lots of information and we are looking into
this information...We are not yet at this moment when I can
announce steps of this case," he said.
Almunia can choose to open a formal investigation into the
case or keep things under wraps if enough banks decide to settle
any charges and only announce a decision at the end.
More than 30 foreign exchange traders at many of the world's
biggest banks have been put on leave, suspended or fired as the
forex probes in the various countries expand.
The probe focuses on activity related to the key foreign
exchange benchmark, known as the WM/Reuters fix, which is tied
to several exchange rates including the euro, sterling, Swiss
franc and yen set daily in London.
These are compiled using data from Thomson Reuters
and other providers, and are calculated by WM Company, a unit of
State Street Corp, and are important because they are
used as reference rates for trillions of dollars worth of
investments, trade and corporate deals around the world.
($1 = 0.7289 Euros)
(Additional reporting by Steve Slater and Clare Hutchison in
London and Maya Nikolaeva in Paris; Editing by Louise Heavens)